Uzbekistan is changing its approach to technology financing. The country’s president announced a transition to a decentralized state venture model: now every ministry and khokimiyat (regional administration) will receive a budget to develop digital solutions for their specific tasks.
What happened
Under the “1,000 Problems — 1,000 Solutions from Youth” project, agency heads will publish industry-specific tasks on a single open platform. To finance the proposed solutions, each minister and khokim (regional governor) will form a venture fund with a capital of at least 10 billion soums. This was reported by a specialized community, citing the president’s open dialogue with the youth.
The funds will go toward rewards for the best ideas and full financing of 20 selected startups—from concept to practical implementation.
In parallel, the Youth Affairs Agency will select 100 projects in IT, business, and the creative economy, investing up to 1 billion soums in each.
Country and market
Historically, Uzbekistan’s venture market relied on a narrow circle of institutional players. According to official data, over the past nine years, the valuation of the country’s startup ecosystem has grown 15 times, exceeding $4 billion. Currently, 23 venture funds operate in the market with a combined capital of about $200 million.
The transition to a decentralized model of ministry-based funds is designed to connect this capital with the real needs of the state apparatus.
Why it matters
For the tech sector, the creation of dozens of new funds means the emergence of a direct business-to-government (B2G) sales channel. Startups developing solutions in artificial intelligence, data processing, regtech, and payment systems no longer need to adapt their products to the abstract demands of investors.
Ministries gain a tool for the rapid digitalization of their processes, bypassing the long cycles of classic public procurement, while developers get a guaranteed budget for piloting.
Tying venture capital directly to specific agency tasks transforms the state from a fragmented grant-giver into a clear client for digital products.
What’s next
The main challenge for the new system will be expertise. Managing venture risks and assessing the technological viability of AI models or fintech architectures require specialized competencies that regional administrations traditionally lack.
The program’s effectiveness will depend on how transparent the selection criteria on the open platform turn out to be and who exactly will make the investment decisions within the agencies.